Thanksgiving week was another winning one for the stock market amid thinner holiday trading conditions. The gains were consistent with a seasonal bias considering the market normally trades with a positive disposition during Thanksgiving week. The seasonality helped to offset the market’s ongoing growth concerns, which were put on the backburner this week despite more news about China’s COVID-related measures.
China confirmed its first COVID-related deaths in six months and new lockdown measures have reportedly brought Beijing to a near standstill.
Aside from the seasonality factor, the upside bias was fueled by better than expected earnings reports from retail issues like Best Buy (BBY) and Abercrombie & Fitch (ANF), along with some names from the tech space like Analog Devices (ADI) and Dell Technologies (DELL). Also, farm equipment company Deere (DE) was among the more notable earnings-driven winners.
Another individual winner this week was Disney (DIS), which traded up on the news that Bob Chapek stepped down as CEO and that former CEO Bob Iger is coming back to run things for a two-year stint.
Movement in the Treasury market was generally supportive of the stock market this week. The 10-yr note yield fell 13 basis points to 3.69% and the 2-yr note yield fell 2 basis points to 4.48%.
Market participants also had a slew of economic data to digest this week. Some reports, like October Durable Goods Orders, October New Home Sales, and the November University of Michigan Index of Consumer Sentiment, were better than expected, but others, like the Weekly Initial Claims and Preliminary November IHS Markit Manufacturing and Services PMIs, were worse than expected.
The FOMC Minutes for the November 1-2 meeting revealed that, “a substantial majority of participants judged that a slowing in the pace of increase would likely soon be appropriate.” This corroborated the market’s notion that the Fed is likely raise rates by 50 bps in December versus a 75 bps rate hike.
All 11 S&P 500 sectors closed with a gain this week. The materials (+3.0%) and utilities (+2.9%) sectors sat atop the leaderboard while energy (+0.2%) showed the slimmest gain as market participants continue to deal with growth concerns.
HAPPY THANKSGIVING 🦃🦃🦃
Source: Briefing Investor